Who Should Consider Chapter 7 Bankruptcy?

While there's no minimum debt requirement, we generally recommend considering Chapter 7 if you have at least $10,000 in outstanding unsecured debt. People file for various reasons, including:

  • Managing overwhelming debt
  • Positioning for major purchases like a home
  • Meeting employment requirements for security clearances

The best way to determine if bankruptcy is right for you is to schedule a free consultation with an experienced bankruptcy attorney.

What Assets Can I Keep in Chapter 7 Bankruptcy?

Contrary to common belief, most people filing for Chapter 7 bankruptcy keep all of their property. In Texas, you can choose between:

Texas State Exemptions

  • Asset-based protections
  • Special provisions for homes, vehicles, firearms, and livestock
  • No "wildcard" deduction

Federal Exemptions

  • Value-based protections
  • Includes a "wildcard" deduction that can be applied to any asset

Who Qualifies for Chapter 7 Bankruptcy?

To qualify for Chapter 7 bankruptcy, you must meet two main criteria:

  1. Time Requirements
  • You cannot have received a discharge from a previous Chapter 7 bankruptcy within the last 8 years
  • You cannot have received a discharge from a previous Chapter 13 bankruptcy within the last 6 years
  1. The Means Test Introduced in 2005 with the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCA), the Means Test determines eligibility based on financial status:
  • Your income is compared to the median income in your geographic region for a household of the same size
  • Adjustments may be made for significant medical costs, child education expenses, and similar circumstances
  • To qualify, your adjusted income must fall below the median income for comparable households in your area